09-23-2019 Council Packet - Laserfiche WebLink

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AGENDA ITEM Prepared By: RJO Reviewed By: DJR Approved By: DJR 1. Purpose. The purpose of this agenda item is adopt the 2020 Preliminary General Fund Budget. 2. Background. Staff has been working on the 2020 General Fund budget since early May. As part of the budget process, there have also been four Council work sessions where the City Council has had the opportunity to provide input and direction to staff. The preliminary budget that is being presented for approval tonight includes expenditures totaling $9,143,200; an increase in expenditures of $565,920 (6.6%). The significant increases are the following. Wages and Benefits (Personal Services) are increasing $296,160 (5.4%). This increase is broken down as follows: Non-Union Wages 3% $27,900 Police Unions (Sgrt and Patrol) 3% + Add Longevity Step $100,000 Admin and Public Works Unions 2.5% $25,250 Health Insurance $126/month/Employee $34,700 Elections Election Year $45,000 Worker’s Comp Ins Exp Rating Change $27,110 Step Increases $36,200 Total $296,160 Insurance expenditures are another category that is increasing significantly (30.5%). This $37,500 increase is due to two factors: one is a change in our loss ratio due to land use lawsuits, and the other is a continuation of a trend of increasing costs related to police departments. There were two changes in accounting practices that increased the General Fund budget, but did not increase overall spending. The first was to move $80,000 in street maintenance from the Pavement Management Fund to the General Fund. The Associated tax revenue was also moved to the General Fund. The other change was to the accounting for the Toward Zero Deaths Grant. This increase of $119,500 is completely offset by an increase in amount of grant revenue recorded. After accounting for these increases, the remaining General Fund increases total $32,760 or 0.3%. For revenues the General Fund budget also totals $9,143,200 and is increasing by $565,920. The largest increase in revenues is the property tax line at $299,000. Other significant increases include $125,000 in the State Grant line item which was also discussed in the expenditure section. Administrative Fees charged to the utility Funds are increasing by $38,000 and are based on a percentage of the Finance and Administration budgets. Coop Police Services are increasing by $57,170 and are the amounts charged to the City’s of Spring Park, Minnetonka Beach and Mound for providing them police services. All other revenue changes total $46,750 and represent 0.5% of the revenue budget. 3. Staff Recommendation. Staff Recommends approval of the 2020 Preliminary General Fund Budget. Item No.: 14 Date: September 23, 2019 Item Description: Adopt 2020 Preliminary General Fund Budget Presenter: Ron Olson Finance Director Agenda Section: Finance Director Report